ASB, Kiwibank take lion's share of Sept qtr mortgage lending

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Kiwibank and ASB Bank between them accounted for nearly 82% of the growth in mortgage lending by registered banks in the September quarter, although both saw profitability slip in the three months.

Wednesday, December 3rd 2008, 5:38AM

by Jenny Ruth

Kiwibank’s mortgage book grew by $418.6 million to $5.52 billion in the three months. Using Reserve Bank figures as a proxy for the market, that means Kiwibank captured 33.8% of new mortgages written by registered banks in the three months, taking its market share to 3.6% from 3.36% three months earlier.

The Reserve Bank figures show total mortgage lending by registered banks grew $1.24 billion to $153.27 billion in the three months ended September.

Kiwibank’s past due residential mortgages rose to $14.3 million at September 30 from $5.9 million at June 30. The proportion of its mortgages with loan-to-value ratios (LVRs) above 80% fell slightly to 17.5% from 17.7% at June 30.

Kiwibank’s net profit slipped to $9.7 million in the three months from $11.4 million in the same three months a year earlier.

ASB’s on-balance sheet mortgages grew $597 million to $36.4 billion, accounting for 48.2% of all mortgage lending by registered banks in the three months. That took its market share to 23.75% from 23.55% three months earlier.

This is the second quarter in a row ASB has increased its market share after previously steadily losing ground since the September quarter of 2006.

ASB had a further $4.57 billion in off-balance sheet mortgages, generally loans approved but not drawn down, down from $4.61 billion at June 30.

ASB had $187 million of past due assets at September 30 of which $111 million were residential mortgages. That was up from $77 million of which $42 million were residential mortgages a year earlier.

The proportion of its mortgages with LVRs above 80% was 15.9% at September 30, up from 15.4% at June 30. About 9.6% of its mortgage loans had lender’s mortgage insurance for the top 20% and 0.8% were 100% insured.

ASB’s net profit fell to $94 million in the three months from $124 million in the same quarter a year earlier.

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